State v. Beyer

This opinion will be unpublished and

may not be cited except as provided by

Minn. Stat. § 480 A. 08, subd. 3 (1998).

STATE OF MINNESOTA

IN COURT OF APPEALS

CX-00-303

Minnesota Council on Compulsive Gambling,

d.b.a. North American Training Institute,

Appellant,

vs.

The Minnesota Department of Human Services and

Jay Bambery and Sharon Autio, as individuals,

Respondents.

Affirmed

Ramsey County District Court

File No. C79810507

John J. Killen, Laura J. Schacht, Johnson, Killen & Seiler, P.A., 811 Norwest Center, 230 West Superior Street, Duluth, MN 55802 (for appellant)

Mike Hatch, Attorney General, David P. Iverson, Assistant Attorney General, 445 Minnesota Street, Suite 900, St. Paul, MN 55101-2127 (for respondents)

            Considered and decided by Klaphake, Presiding Judge, Kalitowski, Judge, and Parker, Judge.*

U N P U B L I S H E D   O P I N I O N

KALITOWSKI, Judge

Appellant Minnesota Council on Compulsive Gambling contends the district court erred in (1) dismissing its claims alleging that respondents failed to comply with competitive bidding procedures and conflict-of-interest rules; and (2) granting respondents' summary judgment motion on appellant's claim alleging interference with prospective business relations.  We affirm.

D E C I S I O N

I.

In reviewing a dismissal for failure to state a claim on which relief can be granted, the only question before the reviewing court is whether the complaint sets forth a legally sufficient claim for relief.  Elzie v. Commissioner of Pub. Safety, 298 N.W.2d 29, 32 (Minn. 1980).  A pleading is dismissed only when it is certain "‘that no facts, which could be introduced consistent with the pleading, exist which would support granting the relief demanded.'"  Id. (quoting Northern States Power Co. v. Franklin, 265 Minn. 391, 395, 122 N.W.2d 26, 29 (1963)).

Appellant Minnesota Council on Compulsive Gambling argues that the district court erred in dismissing count I of its complaint against respondents Minnesota Department of Human Services and its employees Jay Bambery and Sharon Autio.  We disagree.  Count I of the complaint alleged that respondents had failed to comply with competitive bidding requirements for professional or technical services contracts.  Generally, an unsuccessful bidder for a government contract is not entitled to damages.  Telephone Assocs., Inc. v. St. Louis County Bd., 364 N.W.2d 378, 382 (Minn. 1985).  If improper procedures were used, an unsuccessful bidder may recover expenses incurred in participating in the bidding process and costs incurred in a successful attempt to have a contract rescinded.  Id. at 383.  An unsuccessful bidder may also request an injunction prohibiting a specific contract from going forward.  See, e.g., Foley Bros., Inc. v. Marshall, 266 Minn. 259, 266, 123 N.W.2d 387, 392 (1963).

Here, appellant has failed to allege any facts to support either the recovery of costs in preparing a specific bid or an injunction regarding a specific contract.  Because appellant failed to allege any facts supporting the relief available to an unsuccessful bidder, we conclude the district court properly granted respondents' motion to dismiss count I for failure to state a claim on which relief can be granted.

Appellant also argues that the district court erred in dismissing count II of its complaint.  We disagree.  Count II alleged that respondents violated conflict-of-interest rules set out in Minn. Stat. § 16B.175 (1996).  Section 16B.175 was repealed in 1998.  See 1998 Minn. Laws ch. 386, art. 1, § 35.  Appellant fails to state a claim on which relief can be granted under this statute because the statute did not set out any conflict- of-interest rules.  The statute merely directed the Commissioner of Administration to develop guidelines.  See Minn. Stat. § 16B.175 (1996).

Appellant argues that the complaint should be read to state a claim under Minn. Stat. § 16C.04 (1998), which was enacted upon the repeal of section 16B.175.  See 1998 Minn. Laws ch. 386, art. 1, § 5.  Even if the complaint is construed as appellant urges, it still does not state a claim for which relief can be granted because no private cause of action exists under section 16C.04 or the statutes it references.  See Minn. Stat. § 16C.04 (requiring the commissioner to develop conflict-of-interest rules and requiring certain executive branch employees to comply with the code of ethics for state employees found in section 43A.38); Minn. Stat. § 43 A. 38, subd. 5 (1998) (providing that if an employee violates the conflict-of-interest rules, the employee is subject to procedures regarding resolution of conflicts, section 43 A. 39, or disciplinary action); Minn. Stat. § 43 A. 39, subd. 2 (1998) (providing that an employee who fails to comply with chapter 43A is subject to disciplinary action or criminal action under chapter 609).

II.

On appeal from summary judgment, this court asks two questions:  (1) whether there are any genuine issues of material fact, and (2) whether the district court erred in applying the law.  State by Cooper v. French, 460 N.W.2d 2, 4 (Minn. 1990).  "A defendant is entitled to summary judgment as a matter of law when the record reflects a complete lack of proof of an essential element of the plaintiff's claim."  Lubbers v. Anderson, 539 N.W.2d 398, 401 (Minn. 1995).

Appellant argues that the district court erred in granting summary judgment on its claim that respondent Jay Bambery interfered with appellant's prospective business relations.  We disagree.

A cause of action for interference with prospective business relations arises when one intentionally and improperly interferes with another's business relations by either "‘(a) inducing or otherwise causing a third person not to enter into or continue the prospective relation or (b) preventing the other from acquiring or continuing the prospective relation.'"  United Wild Rice, Inc. v. Nelson, 313 N.W.2d 628, 633 (Minn. 1982) (quoting Restatement (Second) of Torts § 766B (1979)).

            Appellant alleged that Bambery intentionally interfered with its prospective business relations by (1) sending two letters to the City of Duluth; (2) encouraging the Minnesota Indian Gaming Association to end its relationship with appellant; and (3) promulgating a rumor that appellant was being forced out of a national council for ethical reasons.

Appellant failed to establish that Bambery's letters to the City of Duluth were improper because appellant did not present any evidence that the letters were not within Bambery's job duties, that Bambery had an improper motive, or that Bambery otherwise engaged in improper conduct.  In fact, Bambery's supervisor stated that she considered the letters to be proper and "well within" the scope of Bambery's job duties.  The text of the letters indicates that Bambery merely urged that Duluth give "additional consideration" to how its funds would be spent and that Duluth consider funding other organizations in addition to appellant.  Thus, the district court properly concluded that appellant had not met its burden of demonstrating Bambery's conduct was improper.  See R.A., Inc. v. Anheuser-Busch, Inc., 556 N.W.2d 567, 571 (Minn. App. 1996) (concluding that, as a matter of law, the plaintiff had not established the alleged interference was improper), review denied (Minn. Jan. 29, 1997).

Appellant alleged that the Minnesota Indian Gaming Association ended its relationship with appellant because of Bambery but presented no evidence to support this speculation.  In fact, the director for appellant stated that she had "no evidence" that Bambery was involved.  Thus, this allegation does not meet appellant's burden of demonstrating that the interference was caused by respondent.  See Hunt v. University of Minn., 465 N.W.2d 88, 96 (Minn. App. 1991) (stating that the plaintiff in an interference case bears the burden of proving that the interference was caused by the defendant).

Finally, appellant's allegation that Bambery promulgated a rumor that appellant was being forced out of a national council for ethical reasons is also insufficient to withstand summary judgment because the only evidence presented by appellant connecting Bambery to the rumors was multiple hearsay.  See Hopkins by LaFontaine v. Empire Fire & Marine Ins. Co., 474 N.W.2d 209, 212 (Minn. App. 1991) (stating that evidence offered to defeat a summary judgment motion must be evidence that would be admissible at trial).

Affirmed.

*  Retired judge of the Minnesota Court of Appeals, serving by appointment pursuant to Minn. Const. art. VI, § 10.